Paying the price: Three landowners

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Jim Ryan is not sure if he will still be in business when his
lease on the Whitehorse Inn expires in 2006. His crippling land tax
assessment meant he has had to cut back staff and work longer hours
to pay the bill. "We can't afford it, mate, that's all there is to
it," he says. The publican's land tax had increased by more than
2000 per cent since 1998. He expects the figure to rise to $40,000
for 2004-05. The pub has been valued at $1.95 million.

When he signed the lease he agreed to pay all outgoings,
including land tax. "When the land tax was $1400, you sort of don't
blink . . . but it has just kept jumping up and up and up."

He says he committed to a new lease six months before the
Government introduced the Retail Leases Bill last year, stopping
landlords passing land tax on to tenants.

"We're a one-storey hotel and the council is rating it on the
assumption it could be turned into a five-storey office block. It's
ridiculous."

DON GOLIGHTLY, 70
Beacon Resort Caravan Park, Queenscliff

LAND TAX FOR 2000 $7000PROJECTED LAND TAX (FEB 2006) $100,000-plus

Don Golightly is outraged that the valuation of his 5.5-hectare
block on the Bellarine Road has risen 500 per cent since 2000.

As a result, he says, his land tax bill will spiral by up to
2000 per cent - from $7000 in 2000 to more than $100,000 when he
next pays the bill, about February 2006.

He created the Beacon caravan park out of "a cow paddock" 33
years ago and has seen the Bellarine Peninsula's popularity
soar.

But he says the land tax system is designed unfairly: "They do
it under the highest potential use, not the existing use."

Mr Golightly, 70, and his family have decided to reduce their
holding. After this summer, he says, 100 of his 300 caravan sites
will disappear as the land is sold off for residential
development.

Once land is worth more than $2.7 million, he says, it is taxed
at 5 per cent. In comparison, WA's rate is 2.5 per cent, NSW's 1.6
per cent and Queensland's 1.8 per cent.

BOB NEELY, 66
Landowner, Phillip Island

LAND TAX FOR 2001-02 $240PROJECTED LAND TAX 2005-06 $44,000

Bob Neely's land on Phillip Island has been in the family more
than 50 years. His brother John's beef cattle now stroll around the
prime real estate just outside of Cowes, happy with the abundant
feed.

Don Golightley.Photo:Ken Irwin

But Bob says he is going to have to sell because he will be
unable to pay the $44,000 land tax bill, brought on by booming
residential land prices on the island.

His 10 hectares were recently evaluated at $2.4 million under a
system that estimates "potential for development".

"It is well overvalued. You are looking at $1 million to divide
it up and install sewerage, water, electricity, phone cables and
stormwater drains.

"It is just a big grab to get your money by the Government."

He says the land is too small to make any money out of as a
farm. "When I opened up the rates notice I nearly had a stroke , I
couldn't believe it."